Libya's Ministry of Economy and Trade, under the Government of National Unity, has introduced new regulations requiring all companies and institutions to submit audited financial statements from external auditors. This move aims to assess the actual size of their activities and ensure fair access to commercial or financial facilities. The new rules replace the previous practice of relying on "random estimates" by committees.
According to the Ministry, the regulation of economic activity and the provision of essential supplies, such as foreign currency and production inputs, will no longer be based on rough estimates. Instead, it will rely solely on official financial statements and tax returns that accurately reflect a company's sales and expenses. This change aims to promote transparency and accountability in the Libyan business environment.
The Ministry emphasized that tax exemptions for certain activities do not exempt companies from disclosing their economic activities. Businesses must demonstrate their activity levels in their records to qualify for specific regulatory treatment. Furthermore, the Ministry has linked fuel allocations to companies' verified sales and activity levels, as stated in their financial statements.
Companies found to have discrepancies between their requested allocations and actual activities will face review and documentation procedures. The Ministry aims to ensure that public resources are directed to those who need them most and promote fairness among businesses. To facilitate compliance, the Ministry has outlined seven key requirements for companies to adhere to.
These requirements include adopting audited financial statements in accordance with Law No. 23 of 2010 and submitting tax returns on time, as per Law No. 7. Companies must also disclose all operational aspects, including those exempt from taxes. The Ministry assured that its goal is not to increase burdens on the private sector but to create a more efficient business environment.
The new regulations aim to reduce individual interventions, organize foreign currency usage, and simplify procedures for compliant companies that prioritize transparency. By doing so, the Ministry seeks to foster trust in the Libyan market. The measures are expected to have a positive impact on the country's economy and business climate.
The Ministry of Economy and Trade announced that these changes will take effect immediately, and companies are expected to comply with the new requirements. The move is part of the government's efforts to enhance economic governance and promote a more transparent and competitive business environment in Libya.
Key points
- Companies must submit audited financial statements to obtain commercial or financial facilities.
- The Ministry aims to promote transparency and accountability in the Libyan business environment.
- The new regulations will help ensure fair access to public resources and promote a more efficient business environment.
